The Total Loss From Jordan’s Terminated Casino Deal

According to the spin doctors: the government “saved the country” $1.4 billion to settle the casino deal that was signed under the previous government as part of a multi-million dollar project. Instead it only ended up costing the taxpayer $157,000. I think setting up a casino in the Dead Sea would have really transformed that area into an actual tourist destination. Not only would it see an increase in tourism but it would encourage more companies to set up, with the casino acting as prime leverage and cause for investment. There are no issues that I can think of that are credible or legitimate enough not to have such a business running in the Dead Sea. Instead the government has canceled the deal and lost money in a process that would’ve seen it earning a whole lot of cash.

Also, the settlement stipulates that the government will allow the company, Oasis, to have first dibs on any casino plans in the future, if/when the government should change its mind. In other words, if the next cabinet, 2-3 years from now decides to put the project back on the table, we will have lost several years of potential financial gains and tourism generation, not to mention having yanked a big investor around. The process will only validate a main concern for large-scale investors: the unsustainablity, unpredictability and inconsistency of governments in Jordan. Would you invest $30 million in a project that the next government could scrap half way through the groundbreaking ceremony?

It’s a shakedown.

34 Comments

  • That was your funniest post yet Nas.
    It is always great to have stuff looked at from a different angle, especially with a tad of sarcasm.

    It really does suck when you win a huge open bidding project, take it through all the legal stages, obtain all the required licenses, then have it “scrapped half way through the groundbreaking ceremony” because it was time to change the doorman at some ministry.

    On a serious note,
    maybe the king knew this time (for a change)
    and realised that the government plans
    (the current, the previous, the Dabbas guy,…. whoever is running this place)
    may hurt his credibility as the 43rd Direct grandson of the prophet (according to daily papers t least )
    [or maybe he realised the potential for the endless series of gambling jokes]

  • One final thing,
    I don’t know if you got the memo or not…
    But blaming the government is so old-news…
    Blame that ex (planning/finance) minister dude…
    You know, the one always taking notes
    It is only hip…but also comes with a touch of “bravery and “political-activism”

  • The law in Jordan actually makes Casinos illegal, and by law all or part of the money a person loses in the Casino they will be able to reclaim in courts. So the laws would have to be changed in order to have such a project go through and be successful.

    I think there are plenty of good alternatives to a Casino. It’s not the only way to “transform the area into an actual tourist destination.”

  • Hamzeh: let me restate that to say: it is the best way to transform tourism in that area. as for legalities, well we all know how that went down when it came to bars and clubs (especially on the main streets) 😉

  • I’m actually not familiar with the history you’re referring to regarding the bars and the clubs.

    I think it’s too hard to judge that it would be the best thing to do, because such a thing was never tried in Jordan before. I don’t think we can judge from what happens in Jericho or Sharm Al Shaikh, and I doubt people would say that Jericho had undergone a major touristic transformation thanks to the Casino, and I don’t think many wil believe that the Casino in Sharm Al Shaikh is what made that destination.

  • Nas, while I do think that a nice, high-quality casino could make a positive difference, I’ve lived in a land with the other kind far too plentiful. So, I’d worry about the crime that usually sees an upswing. One locale we lived in allowed a casino to build, but only after they bought new police cars, firetrucks, and made improvements in the drainage systems for the entire town. Talk about being “invested” in the community…

    One other thing that would make a really nice difference in high-quality, afforable restaurants (you know, even fast food might do) offered as a counterpoint to the ridiculous prices with inadequate quality offered in the hotels…

  • I really dont know if it would have succeded, or if its positive side is higher that its negative side. Anyway it is simply against the law here so it shouldnt go on, I think the last government was so stupid to do such a thing in the dark instead of discussing it with the parlement and talking about it in the news, that would have made people see this chance in other eyes i guess. now it is a No, simply because it was done under a cover. I dont know where our government learns politics.
    I would have supported giving it a chance and change the constitution if they (the economics people) showed that it will bring something to our economy. I dont have to gamble then, the law will only say that its allowed to start such a project, it will not order us all to go gamble.

  • I agree with hamzeh.

    Profits and outcomes of tourism shouldn’t be counted as money. Public perception and social benefits shall be taken into consideration. That’s what’s called a real development. Governments are suppose to promote investments that uplifts the social wellbeing.

    Now come on, casinos don’t exactly have the best mannered customers, gamblers are not gonna uplift tourism in Jordan!

    Businessmen can’t be our leaders, George Bush has set a great example! I know the resemblance is not clear here but the bottom line is that these people are after money no matter what price there people will pay.

  • The dumb thing is that it was allowed to go as far as it did. Is this place really considered a Muslim country???? I keep asking myself and I am not so sure of the answer.

  • im with building a casino in jordan!! everyone here goes to lebanon or egypt to gamble…y dont we attract people to gamble here!! and if u are worried that this is a muslim country or u as a muslim should not gamble then simply dont go there!!!

  • while there is nothing that suggests a casino in the dead sea would replicate the sharm experience, it is pretty safe to assume that one of the biggest incentives happening in sharm right now are the presence of casinos. at least judging by the long lines that wait outside every night. it’s not for the scuba diving

    but yes, there are no gaurentees, however to assume the exact opposite would be true, i.e., a casino would result in an increase in crime or drunkenness is a pretty faulty assumption. such experiences can be seen in the states where casinos open up in towns that are trying to encourage tourism but have no real place for it. something along the lines of an industrial buffalo new york. here, we are talking about a specific area that is dedicated solely to, and survives solely on, tourism. there is a big difference. casinos have a way of attracting other tourist-related projects because in that industry, in that sector, casinos are seen as something other businesses, such as hotels, can bet big on. it creates a market. this is to say nothing of numerous job opportunities involved as well.

    as for questions of morality. this is a globalized world and jordan has liberalized itself. there are bars, clubs, night clubs, and yes even gambling, all of which is legal and apparent. using this as an excuse not to have a casino is at best, hypocritical.

    as for laws, many laws have been changed in recent years to adjust to this liberalization process.

    as for businessmen being our leaders. if there is a transparent process involved then i think that’s exactly who should be leading industrial policy in this country. if it was run more like a business where there are real costs and real profits at stake just as in the private sector, we would be making a lot more money. the key word here is transparency.

    this is a multi-million dollar project. not a start-up company. if it didnt succeed then it would close down and the story would end there. if it did succeed on the other hand, the outcomes would be multiple.

    this however is all just my opinion and it could be argued either way. we’ll just never know. such a project is…a gamble…however, to emphasize the pun, i feel the probability of getting a good hand is simply higher than the opposite.

    on a side note…

    i’m also willing to bet that the reason for its cancellation was not due to questions of morality, it was simply because this government and its members were not a part of the deal and didn’t get in on it in time. let’s see what happens when the time for them to leave office gets closer

  • Im sure this is not the last we will be hearing of this casino story. For the record I support opening a casino near the Dead Sea because of the income/tourism potential, but if it is done it should be done right with full disclosure, proper legal framework and guarantees and compensation for the surrounding community.

  • Nas, I think the people most vocal in opposition to this deal were not so against it because of moral issues, but because of the stinking smell of corruption that comes out of the whole picture.

    The whole reason this deal couldn’t go through is because the opposite of what you said above is true. Gambling IS strictly prohibited by Jordanian law, and the people in the previous government who signed the contract, and those who might have influenced them to do it knew that. In other words, even the people who signed this contract, didn’t really want the deal to go through!!

    From the looks of it, this deal was just a scheme in which a party of great influence, either in the government or outside, wanted to embezzle money by forcing the government to make promises it cannot keep, so that it can then get a share of the money that the government would have to pay in settlement to the foreign “investor.”

    The foreign “investor” was just a screen that hides the identity of that real party that wanted to embezzle the monty.

    This is why the deal excluded an article in the British law that it was supposed to be subject to that held the “investor” under obligation to reveal the identity of any “3rd party” that the investor was going to sell the project to.

    So basically, the corrupt individual(s) sign(s) a separate contract with the “investor” in which he agrees to sell them the project for a certain price (his share basically), and in return he agrees that in case the deal doesn’t go through, he pays them the proceeds of any settlement he receives from the government.

    The only thing I don’t know is how Nader Al-Thahabi could possibly claim that there’s no reason to suspect corruption in this deal. He is obviously trying to protect someone.

  • The process of the agreement to establish the Casino went through all the regular bureucratic measures including no less than 12 official letters and correspondence between the Prime Ministry, the Ministry of Tourism, the Tourism Committee (composed of 7 secretary generals) and the Tourism Promotion Board. This was not the act of one or two persons. The problem is in the agreement itself which places heavy fines on Jordan.
    Regarding the moral and ethical issues I think the whole country is turning into an investment casino, but the problem with gambling as documented in the Jericho Casino was the money laundry and corruption.
    In the end of the day, this is one of the few government decisions that was justifiable economically as well as socially.

  • In the end of the day, this is one of the few government decisions that was justifiable economically as well as socially.

    What?!!!!! Justifiable economically AND socially? Can you please elaborate? What makes it justified with those qualifications? You yourself brought up the money laundry subject too. Is that what made it justifiable in your opinion?

    By the way, it only takes one influential person in Jordan, at the right position in the power ladder, to force everyone underneath from secretaries to committee members to happily sign any document. You know very well this kind of deal is not the only thing that requires many signatures in Jordan, and somehow wasta and influence always manage to make all those things transparent.

    I don’t know, but your comment appeared to defend actions by the government that constituted an egregious breach of the country’s constitution and bypassing one of its main powers; that of the parliament.

    I’m still in complete shock of your last statement and this level of approval of what happened!!

  • //Gambling IS strictly prohibited by Jordanian law//

    Except when it’s the lottery…

    I don’t think they did this for reasons of morality at all, but if it’s one haram thing that isn’t here, all the better. Like Momma Bean I’ve lived in cities and states where casinos were established and there was often a lot of opposition to them (from non-Muslims, I might add), and a question as to the benefits of them after they’d been in operation (higher crime rates in some cases, lack of investment in the local community infrastructure in most others, which I think would *definitely* happen here).

    The question: do people come here b/c they want to gamble? This isn’t Las Vegas or Monte Carlo and never will be. So why do people come to Jordan and what do they want to get out of it? Somehow, I think the people who’d end up in those casinos wouldn’t be sunburned British grams who play the slots on the weekends back home, but Saudi men.

  • Except when it’s the lottery…

    Lottery is certainly a form of gambling, but I’m not sure if Jordan’s laws establish it as an exception. If they don’t, then it just shows how bad we enforce laws in Jordan. If they do, then it just shows how hypocritical our laws can be sometimes!

  • “” There are no issues that I can think of that are credible or legitimate enough not to have such a business running in the Dead Sea.””

    i cant believe you said that, i cant believe it.

    how about this one issue, one little one that i dont know anymore if it really matters to you or not:

    ((يأيها الذين آمنوا انما الخمر و الميسر و الانصاب و الازلام رجس من عمل الشيطان فاجتنبوه لعلكم تفلحون. انما يريد الشيطان أن يوقع بينكم العداوة و البغضاء في الخمير و الميسر و يصدكم عن ذكر الله و عن الصلاة فهل أنتم منتهون))

    الميسر هو القمار
    طبعا بفسر مش لانه عندي فوقية بس لانه واضح انه يا اما ما مرت عليك الاية او انك مش فاهم معناها
    لاحظ ان الية قرنت بين الخمر و الميسر، اللي هم معاصي عظيمة، و بين الشرك و الكفر نفسهم، الانصاب و الازلام!!!!

    no legitimate issue that you can think of?? ittaqi allah ya rajol, shoo tarakt lal ma 3indhom deen? ittaqi allah.

  • khalid: calm down and refer to my comment #12

    if we’re going to implement religion then it should be across the board. if we’ve decided not to, then we might as well allow the one economically-viable business from the “haram” sector.

  • A study in the US concludes that the effect of new casinos on communities is hard to predict as the casino-community relationship is too complex and varies from one community and type of casino to another. Some communities were affected badly in many areas, while others were affected positively. The paper does not provide details that explain the mechanics of the different results, but concludes that the evidence from the cases studied supports neither the pro nor the anti sentiments towards new casinos.

    http://www.ncjrs.gov/pdffiles1/nij/grants/187679.pdf

    Anyway, to me, I don’t think this story caused so much uproar because of the conservativeness of our society, but because of the way in which it was done behind the scenes and ended up causing damage to the country, and because the whole deal is too fishy and highly suspect for being a case of corruption where the intent wasn’t even to establish a casino at all, but to steal money from the government.

    I really hope the rumors about the settlement amount are not true, and I also hope that this deal gets investigated further to find out if really there was any scheme involved to steal government money via the settlement.

  • **eyes rolling**

    Naseem:

    يأيها الذين آمنوا انما الخمر و الميسر و الانصاب و الازلام رجس من عمل الشيطان فاجتنبوه لعلكم تفلحون

    howwa i7na bidoon this project o mish fal7een, what are we gonna be like with it?

    i understadn your point, but i dont accept it, if we have somethign wrong going on in the country, bars and night clubs, we cant possibly just say: well, while you are doing that, its ok to do much bigger and worse things as long as you are doing the smaller things anyways, la ya akhy, not at all, not at all,
    من رأى منكم منكرا فليغيره بيده فان لم يستطع بلسانه فان لم يستطع فبقلبه و ليس بعد ذلك حبة خردل من ايمان، معنى الحديث،
    ya akhy to not hate that fi3l even in your heart, leaves you without 7abbat kahrdal min 2eeman, so what do you think of us if we call for it and say that we see nothing wrong with it?

    ya akhy mal 7aram entering the country!!! how can you support that? in the name of tourisim willa ba66eekh mbasmir, mal 7aram!! na2i9na `3a`9ab min rab il 3alameen o 2illit tawfeeq?? biddak tikhrib byootna?

    if the government is corrupted, we cant possibly morally alow ourselves to hide behind its corruption and accept dirty money inside our country, let me rephrase: ENCOURAGE dirty money into our country just becasue its the govemrnets policy anyways, we should stop against it and declare it and try all we can to stop it from hapening, y akhy at least try to change it by words, AT LEAST, but to call for it?? what were you thinking!!! just because the goverment is corrupted, doesnt mean that you and i are allowed to be corrupted too. doesnt at all. they will be questioned about their deeds in the judjment day, and you will be questioned seperately, and it wont help you that they did it first, or started it first, you will only be asked about what YOUUUUUU did to prevent it, did you advice people at least against it, or did you PROMOTE it?

    regardless of the fact that i agree with you that cancilnig the project most probbaly doenst have anything to do with moral grounds, since we already have all immoral things in th world as you stated, its probbaly due to some corruption story as you said too. but never the less, even if its 7aqqon yorado bihi ba6il, i am very, very happy that it was canciled, God knows that this country is in enough trouble already without that additional mal 7aram entering it. alla yostor 3alena o 3alek ya akhy ostor 3alena, il 7aram bikhrib il byoot.

  • “**eyes rolling**”

    i find it ironic, if not hypocritical, that in the first line you attempt to show the person you disagree with a sign of disrespect, and then in the next line, you quote the quran.

  • fine! rawi`3 and go right and left and avoid the subject, have it your way. i can be easily excused for rolling my eyes, look at your argument, its very eyes-rolling stimulating!!

    wasnt meant to be a sign of disrespect anyways, i take it back if its whats bothering you and if its gonna let you look at the content of what i wrote.

    **eye rolling counter clock wise to undo the effect of eyes rolling in the first time**

  • khalid, wow, even your apology for being disrespectful is in itself a sign of disrespect. that’s got to be some sort of a record. i’m fine, by the way, looking at the content and addressing it, it’s just hard to counter someone’s argument when they start off in such a way, and I think, as a Muslim, you’d probably agree.

    but let’s get on with it, as you suggested…

    when it comes to “mal 7aram entering the country”, surely you’re not naive enough to believe that the “mal” already in this country is halal, or that a casino is “the ultimate evil” compared to what we have. in fact, economically speaking, it may be the least of our propagated evils.

    second of all, please stop blaming the government for all the corruption in the world. it is the government that allows the opening of various institutions we deem “haram” but it is the people who engage in them. they don’t force society to open bars, clubs, or nightclubs, and they don’t force society to engage in the activities related to this businesses.

    The God I believe in is smart enough not to ask me on judgment day what i did to prevent the opening of a casino or a bar or a what-have-you in a country where there is no institutionalized mechanism for public debate and public involvement beyond a window-dressing parliament. if i, as a citizen, have no say in the decisions this government makes, then i cannot be held accountable for their actions. I can be held accountable for my own actions, and if such a place were to open, i would not enter it. that’s the most i am permitted to do. if this issue was held to public debate, or at least legitimate representative debate, then I, as a citizen, could hold my representative responsible for their vote to approve such a project. In the absence of that reality, in the absence of political free will as tied to my personal moral free will, then i might as well ask for economic free will.

    I we are worried about the social and moral fabric of the country, then this casino is not the straw that is going to break this already-broken camel’s back.

  • if i, as a citizen, have no say in the decisions this government makes, then i cannot be held accountable for their actions. I can be held accountable for my own actions

    True, but I think the impression that others (e.g. Khalid Jarrar) are getting is that if indeed you had the opportunity to have a say in the decisions of this government, you would have not prevented the Casino from opening and might have even actually fought for it, and I think that is something that a Muslim would probably feel that they can be held accountable for in front of God.

    But the thing is, I think this whole discussion is on one track, and the reality of what the deal was about is on another. Like I said in a previous comment, I don’t think anybody who participated in this deal believed or even wanted the Casino to be established. If you read the detailed analysis by Hammouri in Al-Arab Al-Yawm about the deal, you can’t possibly be left with the impression that whoever was responsible for this deal didn’t have bad intentions of embezzling money from the government of Jordan. The analysis is here:

    http://www.alarabalyawm.net/pages.php?articles_id=4597

  • As-salamu Alaykum,
    When I first read your post, I did not think you were serious. Two wrongs don’t make a right. All the money in the world doesn’t make it right. I don’t care what kind of haram exists in Jordan, it is not an excuse to start building casinos. And I do believe we are ALL responsible on SOME level for what takes place around us. If we can change something with action, then we should. If not, we should try doing so with our words. If we can’t manage that, then we should at least hate it with our hearts. As a writer and blogger, your words have some weight. They influence and inspire people. I really hope you (and others) will consider the casino issue from a broader perspective.

  • hamzeh: that might be the answer, but these are people who tend to ask questions of morality, which in my opinion, are non applicable within the context of the status quo. so instead, my argument and/or reasoning becomes solely political and economical, because that’s all we’re left with and that’s all they’ve left us with.

    i have no doubt that there was corruption involved, which is why i suggested this is just a case of a shakedown. a casino will eventually open, under new terms, and with new government officials involved in the matter. history has shown that. their approach to the deal has been a rejection under the guise of protecting the social fabric, which most Jordanians who ask questions of morality will cheer for.

    the rest of us, who focus on the political and economic aspects, probably know better.

    A: i am not a policy maker, and unfortunately, this is a country where decision-making is highly centralized that the decision-makers have, by default, chosen that the sole responsibility lie with them. then so be it.

    and if you think that words, specifically my words, make an impact on Jordanian domestic policy, then you have highly overestimated the power of this little blog, and this little writer.

  • Khalid,
    The definition of “Mal 7alal” is a bit different than the one you imply, Mal 7alal means worked for, or, not stolen. So if some “A” had all his money 7aram and you worked for him, then the money you get from him is 7alal, not 7aram coz you worked for it, and didnt steal it from him, he “A” is the one to be punished then for his mistakes, not you. So its no problem for you in case you keep working “bel 7alal”.
    Another point, Jordan belongs to Jordanians, not to Believers. I am a Muslim like you are, but We both know that Jordan is not all believers, and those non-believers have the right to live with us and practice life and enjoy Jordan as much as we do, We in our limits (which may be built on our belief and ethics) and they under their limits (which are also built on their ethics and beliefs) and if their beliefs does not stop them from gambling then why not, if this will bring good economical sides to Jordan. its good to learn to see the others and recognize their rights.

  • Salam Nas,
    My point is not that you necessarily affect Jordanian domestic policy with your blog. My point is that you can (with your words) influence the way ordinary people think. People look up to the writers they like and sometimes adopt their ideas. For example, if you tell me that there is a project that needs my help in Jordan, I will take it more seriously “because Naseem believes in it, so it must be something worthwhile.” We all do this on some level, consciously or not. So, if a person is not really sure about the casino issue, you definitely do have the ability to convince him one way or another.

    MD,
    even in the US, where a lot of people gamble, gambling is restricted to very specific areas of the country, such as the state of Nevada, Atlantic City, and some other places. Of course, there is also the lottery, which is everywhere. For the most part, though, people do recognize the immense harm gambling brings to society, and most people do not want this environment in their backyards, or in close proximity to their children. They don’t only look at the money aspect of the situation.

    So, my point here is that it is not just a Muslim or religious issue, and gambling is not a “right.”

    Corruption
    Addiction to Gambling
    Losing Huge Amounts of Money, even a home or a business in search of the elusive big win

    These are just a few reasons why gambling is harmful to families, societies, and individuals. Besides this, crimes of every type go hand in hand with gambling. I have been to cities where gambling is prevalent (such as Las Vegas), and it is not pretty what people do there.

    Why would anyone, Muslim or not, want that in Jordan? Why can’t we be proud that there is still some khair that prevents us from crossing the line onto yet another slippery slope.

    A related issue:
    http://news.bbc.co.uk/2/hi/middle_east/7415495.stm
    Sheikh bans alcohol at Cairo hotel

  • There’s an update on this story. It seems that the missing page (page 9) from the original contract between the government and the “Oasis” company is available and here is another article by the same ex-minister Dr. Hammouri about what came in it.

    I think you should be very interested in reading these articles Nas. They’re long, and they’re in Arabic, but they’re very revealing of the amount of corruption that was involved in this deal:

    Here’s part 1 again:
    http://www.alarabalyawm.net/pages.php?articles_id=4597

    And here’s part 2 from yesterday’s paper:
    http://www.alarabalyawm.net/pages.php?articles_id=4741

    Some highlights of the deal from the most recent article (in Arabic):

    المادة (24) تلزم الدولة الاردنية بأن يصبح الحكم الصادر عن هيئة التحكيم من حيث وجوب تطبيقه وكأنه صادر عن القضاء الاردني

    المادة (24) من الاتفاقية تلزم الدولة, بأن يكون الحكم الصادر عن هيئة التحكيم مشمولاً بمعاهدة الامم المتحدة لعام 1958

    المادة (22) اوجبت على الحكومة ان تدافع عن شركة الكازينو والشركاء فيها او الشركة المتفرعة عنها اذا رفعت عليها الدعاوى او تمت ملاحقتها بأية مطالبات او بوشر ضدها بإجراءات قانونية

    تتعهد الحكومة لشركة الكازينو ان لا يلحق بها اي ضرر وأن تعوضها عن جميع ما تدفعه او تتكبده من خسائر جراء تلك الدعاوى والمطالبات والإجراءات, وذلك على مدى السنين الخمسين المقبلة

    وفقا لنص المادة (25) لا يجوز لأية نصوص في قوانين الدولة ان تحل محل اي نص في الاتفاقية طيلة الخمسين سنة المقبلة, الا اذا وافقت شركة الكازينو على ذلك

    وفقا للمادة (23) فان اتفاقية الكازينو بما فيه بنودها وشروطها هي اتفاقية سرية وتلتزم شركة الكازينو وحكومة المملكة بالمحافظة على سرية هذه الاتفاقية!!

    شركة الكازينو لا تخضع للقوانين الاردنية المتعلقة بتعديل مقدار الضرائب والرسوم والجمارك والعوائد التي تفرض داخل المملكة او اية قوانين جديدة بهذا الشأن ولمدة الخمسين سنة المقبلة

    This is what our previous government agreed on. As I said before, there is only one logical explanation to this, and that is that this deal was only struck to bank on the settlement money, which was going to go to a 3rd party which is most probably Jordanian.

  • I second on comment #30 addressing you Nas, there’s a virtue reading blog posts a week or two later; one can save himself awful lot of trouble and basically observe the clay pots crash upon each other.

    But still, I’m still mesmerized about the perspective you reflected on that issue: Is the endorsement you expressed of the project was stemming from a pure pragmatic and realistic perspective? Despite a personal convections that (if mainstream-ishly coherent) should probably be content by the cancellation of it!

    Honestly, until the end of the post, I was wishful enough to expect a smart paragraph or an eloquent closing statement that would spin-off what I just read to something that is more consistent with what I usually expect from Nas! Yet, reading through the response you made, I still find this specific post a bit “queer”… to say the least.

  • “we will have lost several years of potential financial gains and tourism generation, not to mention having yanked a big investor around.”

    i guess we lost 3 years till this point! bas u know Bakhit is back to bring money back LOL

Your Two Piasters: